“Annual capital expenditure on floating production systems is set to exceed US$8 billion, with a predicted 84 Floating, Production, Storage and Offloading (FPSO) vessels accounting for some 68% of investment over the next five years”, said the study’s main author Steve Robertson.
“The overall picture is one of strong market growth from 2004 onwards, with annual global expenditure in the FPS sector rising from an estimated US$4.8 billion in 2004 to reach US$7.8 billion in 2008. An expenditure peak is expected in 2007, when the annual spend is expected to reach US$8.3 billion.
“In terms of the total market, and counting floaters of all types, we expect West African expenditure to lead at some US$10 billion over the next five years. Although Brazil will see a strong surge in investment, North America will also see good growth and is likely to be in second place with a forecast spend of over US$7 billion.
“The other main characteristic of the market will be the continuing shift to deepwater” said Robertson. “We forecast that 70% of the global spend will be on floaters moored in water depths of 500 metres or greater.”
“Over the past five years the deepwater market was dominated by the US Gulf of Mexico and Brazil which together accounted for over 75% of the total spend.
“The market distribution for the 2004-2008 period is markedly different, the main change being the high growth in the value of deepwater activity off the west coast of Africa. We forecast Capex of US$8.5 billion associated with deepwater FPS installations here, making the region the world’s leading deepwater FPS theatre.
“All the other regions will also see increases in deepwater FPS activity, with North America’s spend rising to US$7.0 billion (31% of the global deepwater total), and Latin America’s to US$4.9 billion. Australia looks set to see its first deepwater deployment, with Woodside’s Enfield FPSO installation forecast for 2006. Off Asia a total of nine installations – five TLPs, two spars, a barge and a FPSO – are forecast with a total capex of US$1.7 billion.”
The report added that over the next five years just 12 operators are expected to account for 60% of the installations and almost 80% of the capex forecast worldwide. Petrobras, with 13 installations forecast, is expected to be the biggest spender, followed closely by ExxonMobil, then ChevronTexaco, BP and Shell.
